Treasury Secretary Janet Yellen offered sharp criticism Wednesday of U.S. tariffs on Chinese goods, promising to “reconfigure” the import taxes while her department continues to review them.
“This administration inherited a set of (Section 301) tariffs imposed by the Trump administration that I think really weren’t designed to serve our strategic interests,” Yellen said in testimony before the House Ways and Means Committee.
While China is guilty of “unfair trade practices,” she said, it’s American consumers and businesses that are being hurt by the tariffs on more than $300 billion worth of Chinese goods. The Treasury Department is looking at how it can “reconfigure those tariffs in a way that would be more strategic,” she said.
China responded to the Section 301 tariffs during the Trump administration by hitting U.S. agricultural exports with retaliatory tariffs. China agreed to waive some of those tariffs on an ad hoc basis if importers applied for temporary exemptions after the two countries brokered the “Phase One” agreement.
China agreed under the 2020 “Phase One” deal to lift key trade barriers to U.S. ag as well as buy about $80 billion worth of U.S. farm commodities over a two-year period.
Some of the biggest U.S. farm groups signed off on a letter to U.S. Trade Representative Katherine Tai last month asking the Biden administration to withdraw Section 301 tariffs on China as well as Section 232 tariffs on steel and aluminum imports from China and elsewhere.
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“By rolling back 301 and 232 tariffs and eliminating retaliatory tariffs, you can increase market access for U.S. food and agriculture exports and reduce costs for critical machinery, fertilizer, agricultural chemicals and other food and agriculture inputs,” says the letter signed by the American Farm Bureau Federation, the Almond Alliance, the American Soybean Association, the National Association of Wheat Growers, National Pork Producers Council, U.S. Grains Council and others. “These efforts would have an immediate effect and would ease the uncertainty felt by all rural America.”
Yellen also said it would not be long – just a matter of weeks – before the Treasury Department wraps up its evaluation on the Section 301 tariffs that were levied in response to allegations that China was stealing U.S. intellectual property and forcing U.S. companies to give up technology secrets.
A World Trade Organization panel ruled in 2020 that the U.S. broke its international commitments by circumventing the WTO dispute system and hitting China with the Section 301 tariffs.
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